Agrimony Commodities Ltd Directors Report.

DEAR SHAREHOLDERS,

Your Directors are pleased to present the 26th Annual Report of the Company, along with the Audited Financial Statements for the year ended 31st March, 2017.

1. FINANCIAL HIGHLIGHTS

(Rs. in Lakhs)

Particulars

Standalone

Consolidated

2016-2017 2015-2016 2016-2017 2015-2016
Net Sales/ Income from Operations 981.46 1783.97 983.95 1787.78
Other Income 75.29 72.76 80.21 76.45
Total Income 1056.74 1856.73 1064.17 1864.23
Less: Expenditure (1050.14) (1843.11) 1063.96 (1843.92)
Profit/(Loss) before Interest & Exceptional Items 6.61 19.15 0.21 20.31
Less: Interest (1.83) (5.54) (1.83) (5.56)
Profit/ (Loss) after Interest before Tax & Exceptional Items 4.78 13.61 (1.63) 14.74
Exceptional Items (1.94) (0.02) (1.99) (0.40)
Profit before Extraordinary Items and Tax 2.84 13.60 (3.62) 14.35
Extraordinary Items- - (23.13) - (23.12)
Profit/(Loss) before Tax 2.84 (9.53) (3.62) (8.77)
Less: Tax provisions (1.30) (2.52) (0.83) (2.72)
Profit/(Loss) After Tax 1.54 (12.05) (4.45) (11.49)
Add: Profit/ (Loss)Brought Forward 164.62 176.67 167.04 178.53
Amount available for Appropriation/ (Loss) 166.16 164.62 162.59 167.04

2. OPERATIONS REVIEW

The Income from operation for the financial year 2016-17, for the year under review was at Rs. 981.46 Lakhs compared to Rs. 1783.97 lakhs during the financial year 2015-16. The company revenue has decreased by 43.05%. The EBIDTA excluding exceptional items, stood at Rs.4.78 lakhs during financial 2016-17, as compared to Rs. 13.61 lakhs in the Previous Financial year 2015-16. Although company has earned profit of Rs. 1.54 Lakh as compare to loss of Rs. 12.05 lakh by adjusting all the losses of the previous years.

During the year your Company dealt with those contracts which resulted in good profit and company has restricted its dealing on contracts where reasonable profit has been foreseen. The result of this decision led to higher margin which is evident from the performance of the company. The Net Profit ratio is 0.16% in the current financial year (2016-17) as compared to -0.68% is previous year (201516).

3. SHARE CAPITAL

There is no change in paid up capital. The paid up Equity Share Capital as at March 31, 2017 was Rs. 11,39,00,000/-. During the year under review, the Company has not issued shares with differential voting rights nor has granted any stock options or sweat equity.

4. DIVIDEND

With a view to strengthen the financial position of the Company, Your Board of Directors have not recommended any dividend for the financial year 2016-2017.

5. RESERVES

Directors have not transferred any amount to general or other reserves.

6. BOARD OF DIRECTORS

6.1 Composition

The Board of the Company presently consists of 4 directors, out of which 2 (Two) are independent Directors.

6.2 Retirement by Rotation

Pursuant to the Clause 129 of the Articles of Association of the Company read with Section 152 of the Companies, Act 2013, Mr. Anandrao Gole is due to retire at the ensuing Annual General Meeting and is eligible for re-appointment.

6.3 Independent Director

Declaration by Independent Director

All the Independent Directors have given declarations that they meet the criteria of independence as lay down under Section 149(6) of the Companies Act, 2013.

Appointment and Resignation of Independent Director

Mr. Satish Bokdia (DIN: 02422260) has resigned from the directorship w.e.f. 7th October, 2016.

Ms. Nalini Shetty (DIN: 07124868) Independent Directors of the Company was appointed for term of 2 (Two) years and their appointment was approved by the shareholders at the 24th Annual General Meeting of the Company. Their tenure expires at the conclusion of the ensuing 26th Annual General Meeting of the Company.

The Nomination and Remuneration Committee at their meeting held on 27th July, 2017 has recommended a second term for Ms. Nalini Shetty, Independent Directors. The Board of Directors have also recommended appointment for a second term of 5 (Five) years for Ms. Nalini Shetty upto the conclusion of 31st Annual General Meeting of the Company, subject to the approval of members at the ensuing Annual General Meeting.

6.4 Number of Meetings of the Board

During the year under review, 10 (Ten) Board Meetings were duly held. The intervening gap between the Meetings was not more than 120 days as prescribed under the Companies Act, 2013.

Sr. No. Date of Meeting
1 21th April, 2016
2 27th April, 2016
3 30th May, 2016
4 13 th July, 2016
5 9 th August, 2016
6 7th September, 2016
7 8th October, 2016
8 7th November, 2016
9 23rd December, 2016
10 25 th March, 2017

6.5 Separate Meeting of Independent Directors

A separate meeting of Independent Directors of the Company was held on 31.03.2017 in accordance with the provisions of clause VII of the schedule IV of the Companies Act, 2013

7. KEY MANAGERIAL PERSONNEL

During the year under review, Ms. Monali Mehta, Company Secretary & Compliance Officer of the Company resigned from Office on October 08, 2016 and Ms. Sheetal Musale has been appointed as Company Secretary & Compliance Officer of the Company w.e.f. April 19, 2017.

The performance of the Company is improving as is evident from its financial position of the Company. Due to accumulated losses in the previous years, no remuneration was paid to Mr. Anandrao Gole, Managing Director of the Company as per his choice and as approved by the Board.

The Companies performance has gradually improved in the Current year (2016-17) and therefore Mr. Anandrao Gole proposed to the Nomination and Remuneration Committee to consider payment of remuneration from the financial year 2017-18.

The Nomination and Remuneration committee in its meeting held on 27th July, 2017 reviewed the proposal by Mr. Anandrao Gole and approved the remuneration payable as mentioned in its appointment letter dated 10th December, 2013 and further recommended the same to the board.

The board in its meeting held on 28th July, 2017 evaluated the point recommended by Nomination and Remuneration committee; the same was briefly discussed and approved by the board.

8. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134(3)(c) of the Companies Act, 2013, with respect to the Directors Responsibilities Statement, it is hereby confirmed that:

a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b. the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

c. the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d. the directors had prepared the annual accounts on a going concern basis; and

e. the directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

f. the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

9. DISCLOSURES RELATED TO COMMITTEES/COMMITTEE RECONSTITUTION

We have reconstituted the committees w. e. f. 7th October, 2016 are as follow:

9.1 Audit committee

The Composition of the audit committee is in conformity with the provisions of the Section 177 of the Companies Act 2013 which comprises as follows:

Consequent upon the resignation of Mr. Satish Bokdia (DIN: 02422260) as an independent Director the audit committee was re-constituted w.e.f. 7th October, 2016 as follow:

Constitution Till 7th October 2016

Re-constitution

Sr. No. Name of Members Designation Name of Members Designation
1. Mr. Satish Bokdia Chairman & Independent Director Mr. Suresh Kulkarni Chairman & Independent Director
2. Ms. Nalini Shetty Member & Independent Director Ms. Nalini Shetty Member & Independent Director
3. Mr. Suresh Kulkarni Member Mr. Jairaj Bafna Member

Company has conducted 6 (Six) Audit Committee Meeting during the year 2016-17.

9.2 Nomination & Remuneration Committee

The Composition of the Nomination Remuneration committee is in conformity with the provisions of the Section 178 of the Companies Act 2013 which comprises as follows:

Consequent upon the resignation of Mr. Satish Bokdia (DIN: 02422260) as an independent Director the audit committee was re-constituted w.e.f. 7th October, 2016 as follow:

Constitution Till 7th October 2016

Re-constitution

Sr. No. Name of Members Designation Name of Members Designation
1. Ms. Nalini Shetty Chairman & Independent Director Ms. Nalini Shetty Chairman & Independent Director
2. Mr. Satish Bokdia Member & Independent Director Mr. Suresh Kulkarni Member & Independent Director
3. Mr. Suresh Kulkarni Member & Independent Director Mr. Jairaj Bafna Member

Company has conducted 1 (One) Nomination and Remuneration Committee Meeting during the year 2016-17.

9.3 Stakeholder Grievances Committee Minutes

The composition of the Stakeholder Grievances Committee is in conformity with the provisions of the Section 178 of the Companies act 2013 which comprises as follows:

Consequent upon the resignation of Mr. Satish Bokdia (DIN: 02422260)) as an independent Director the audit committee was re-constituted w.e.f 7th October, 2016 as follow:

Constitution Till 7th October 2016 Re-constitution
Sr. No. Name of Members Designation Name of Members Designation
1. Mr. Suresh Kulkarni Chairman & Independent Director Mr. Suresh Kulkarni Chairman & Independent Director
2. Mr. Satish Bokdia Member & Independent Director Ms. Nalini Shetty Member & Independent Director
3. Ms. Nalini Shetty Member & Independent Director

Company has conducted 5(Five) Stakeholders Grievances Committee Meeting during the year 2016-17

10. PERFORMANCE EVALUATION

Pursuant to the provisions of Section 134(3](p] of the Companies Act, 2013 and Schedule IV of the Companies Act, 2013, the board has carried out the annual performance evaluation of the Board as the whole, various Committees of the Board and of the Directors. The performance evaluation of the

Independent Directors was carried out by the entire Board. The Directors expressed their satisfaction with the evaluation process.

The Board and Nomination and Remuneration Committee reviewed the performance of the individual Directors on the basis of the criteria such as Transparency, Performance, etc.

In the separate meeting of Independent Directors, performance of non- independent Directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of the executive directors and non- executive directors. The same was discussed in the Board meeting that followed the meeting of independent directors, at which the performance of the board, its committee and individual Directors was also discussed.

11. DEPOSITS

The Company has not accepted any deposits covered under Chapter V of the Companies Act, 2013, during the financial year and as such, no amount on account of principal or interest on deposits from public was outstanding as on 31st March, 2017. The Company has no deposit which is not in compliance with the provisions of Chapter V of the Companies Act, 2013 and as the Companies (Acceptance of Deposit] Rules, 2014.

12. SUBSIDIARY

The Company has attached along with its financial statement, a separate statement containing the salient features of the financial statement of the said wholly owned subsidiary in "Form AOC-1" which is annexed as "Annexure - A".

13. CONSOLIDATED FINANCIAL STATEMENTS

As stipulated under the provisions of the SEBI (Listing Obligations & Disclosure Requirements], Regulations, 2015, the Consolidated Financial Statements have been prepared by the Company in accordance with the applicable Accounting Standards. The audited Consolidated Financial Statements together with Auditors Report form part of the Annual Report.

14. INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY

Company has reviewed the Internal Financial Control Report which has been submitted last year by Internal Auditor, which required management intervention and actions. The actions taken by the management were reviewed by the internal auditor as per their report for the financial year 2015-16

The Board of Directors hereby report that that the same has been considered and proper action as envisaged has been taken.

15. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENT BY COMPANY

During the year under review, your company has granted loans to the extent of Rs. 762.03 Lakhs out of which Rs. 87.50 Lakhs has been invested in Wholly Owned subsidiary i.e. Advantage Commodities Pvt. Ltd. and is in compliance with the provisions of Section 186 of the Companies Act, 2013

During the year under review, your Company has not given any guarantee to any person falling under ambit of Section 186 of the Companies Act, 2013.

16. PARTICULARS OF CONTRACTS OR ARRANAGEMENTS WITH RELATED PARTIES

All related party transactions made during the financial year 2016-17 were on arms length basis and were in the ordinary course of business. All transactions with related parties are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of afore seen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement specifying the nature, value and terms & conditions of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a Half yearly basis.

All transactions entered into with related parties during the year were on an arms length basis and were in the ordinary course of business. Accordingly there are no transactions that required to be reported in Form AOC-2.

17. EXTRACT OF ANNUAL RETURN

The details forming part of the extracts of Annual Return in Form MGT-9 pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and administration) Rules, 2014 is prescribed in "Annexure - B" and forms an integral part of this report.

18. MATERIAL CHANGES AND COMMITMENTS

There have been no material changes and commitments, affecting the financial position of the Company, which has occurred between the end of financial year of the Company and the date of this Report.

19. RISK MANAGEMENT POLICY

During the year under review, the Company has identified and evaluated elements of business risk. Business risk, inter alia, further includes fluctuations in foreign exchange, Raw Material Procurement risk, Environmental & Safety Risk, Working Capital Risk, Market Risk and Business Operations Risk. The risk management framework defines the risk management approach of the Company and includes periodic review of such risk and also documentation, mitigating controls and reporting mechanism of such risks. The Board of Directors and senior management team currently assess the operations and operating environment to identify potential risks and take necessary mitigation actions.

20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS /TRIBUNALS

No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Companys operations in future.

21. REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration including criteria for determining qualifications, positive attributes and other matters provided under sub section (3) of section 178 of the Companies Act 2013. The Company’s Remuneration Policy for Directors, Key Managerial Personnel and other employees is available on Company’s website at www.agrimonycommodities.com and also enclosed as "Annexure - C".

22. CORPORATE GOVERNANCE

As per Regulation 15 (2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, para C of Schedule V relating to Corporate Governance Report, shall not apply to company listed on SME Exchange. The Company being a company listed on BSE SME Platform, preparation of corporate governance is not applicable.

23. MANAGEMENT DISCUSSION AND ANALYSIS

In terms of the Regulation 34 read with Schedule V of SEBI (LODR) Regulations, 2015, Management Discussion and Analysis is set out in the Annual Report as "Annexure-D".

24. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION ANDFOREIGN EXCHANGE EARNINGS AND OUTGO

A. Conservation of energy, technology absorption

As the Company does not fall under any of the industries listed out in the Schedule appended to the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, particulars required to be disclosed with respect to conservation of energy and technology absorption, are not applicable to the Company.

The operations of your Company are not energy intensive. Your Company takes various measures to reduce energy consumption by using energy-efficient computer systems, electrical and electronic equipment and procuring energy efficient equipment and gadgets in its operation. As an ongoing process, your Company evaluates new technologies and techniques to make its infrastructure more energy efficient.

B. Foreign Exchange Earning/Outgo:

The Company has no Foreign Exchange Earning/ Outgo in Financial Year 2016-17.

25. AUDITORS

25.1 Statutory Auditors

Pursuant to the provisions of section 139, 142 and other applicable provisions, if any, of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, as amended from time to time and pursuant to the recommendation made by the Audit Committee, M/s. V. R. Bhabhra & Co. Chartered Accountants, bearing Registration No.112861W, be and is hereby appointed as the Statutory Auditor of the Company for further period of five years to hold office from the conclusion of 26th Annual General Meeting till conclusion of the 31st Annual General Meeting (subject to ratification of the appointment by the members at every Annual General Meeting held after this Annual General Meeting) and the

Board be and is hereby authorized to fix such remuneration as may be determined in consultation with the Auditors, in addition to reimbursement of all out-of-pocket expenses as may be incurred in connection with the audit of the accounts of the Company.

In this regard, the Company has received a certificate from the Auditors to the effect that if they are reappointed, it would be in accordance with the provisions of the Section 141 of the Companies Act, 2013.

There are no qualifications, reservation or adverse remarks or disclaimers made by the Statutory Auditors in their Audit Report.

25.2 Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed M/s. Dhirendra Maurya & Associates, Company Secretaries (C.P. No. 9594), to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as "Annexure - E" and forms an integral part of this report.

There are no qualifications, reservations or adverse remark or disclaimer made by the auditor in their Report.

26. MANAGERIAL REMUNERATION

Disclosures with respect to the remuneration of Directors and employees as required under Section 197 of Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith and marked "Annexure - F".

27. PARTICULARS OF EMPLOYEES

The provisions of Rule 5(2) & (3) of the Companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014 requiring particulars of the employees in receipt of remuneration in excess of Rs.1.02 Crores per year to be disclosed in the Report of Board of Directors are not applicable to the Company since none of the employee was in receipt of remuneration in excess of Rs. 1.02 Crores during the financial year 2016-17.

28. DISCLOSURE ON WOMEN AT WORKPLACE

The Company has formulated and implemented a policy on prevention of sexual harassment at workplace with a mechanism of lodging complaints. During the year under review, no case was reported in this regard.

29. CORPORATE SOCIAL RESPONSIBILITY (CSR)

CSR related provisions of the Companies act, 2013 do not apply to the Company as the Company does meet profit, turnover or net worth criteria prescribed in this regard.

30. VIGIL MECHANISM/ WHISTLE BLOWER POLICY

The Company has established the Vigil Mechanism Policy/ Whistle Blower Policy for the Directors and employees for reporting the genuine concerns and grievances, significant deviations from the key managerial policies and reports any non-compliance and wrong practices, e.g unethical behaviour, fraud, violation of law, inappropriate behaviour/ conduct etc.

The functioning of the vigil mechanism is reviewed by the Audit Committee from time to time. None of the directors or employees has been denied access to the Audit Committee of the Board.

The Vigil Mechanism Policy/ Whistle Blower Policy is uploaded on the Website of the Company at www.agrimonycommodities.com.

31. ACKNOWLEDGEMENTS

The Directors wish to thank and deeply acknowledge the co-operation, assistance and support extended by various Government Authorities, Company’s Bankers, Dealers, Vendors, Customers, Suppliers, Shareholders, Stock Exchange and others who have supported the company during its difficult time and hope to receive their continued support.

The Directors also wish to place on record their appreciation for the all round co-operation and contribution made by employees at all levels.

For and on behalf of the Board of Directors of
Agrimony Commodities Limited
Sd/-
Anandrao Gole
Place: Mumbai Chairman & Managing Director
Date: September 04, 2017 DIN: 06668955